I think that is a chance we have to take. Minimum wage has failed to keep up with inflation. It needs to be corrected.
It is a real argument you’re making but nothing new either. I think we all know about that option for business.
They didn’t get that way by writing a bunch of checks.
But it’s a moot point as a huge block of employers are non-wealthy small businesses who get hammered by this stuff. One of my sons owns 2 restaurants. His waitstaff makes about $80 an hour just on tips. Should he really have to bump up their base minimum to $15?
A kid making $7.25/hour flipping burgers and a man digging a ditch for $15/hour are not exchanging the same type of labor for the compensation they are receiving, which is why the ditch digger receives more. Under your plan they now get paid the same. Guess what the ditch digger will want?
Employees generally get paid what they are worth, or they go elsewhere. If one is receiving exactly minimum wage it is the employer saying “I’d pay you even less but it would be illegal”.
It is also a matter of training. All of my employees who are trained make more than $15, most much more than that. However, I spend thousands of dollars as it is to get them to that point. I start them out at $11 an hour, as that’s the best I can afford as I’m going to be losing money on them for the first month or two anyway.
If I have to start them at $15, I’m going to be much more picky about those I hire, and much quicker to cut my losses if it doesn’t seem as though they are coming along.
One benefit of a UBI and no MW would be that someone would have a much easier time getting me to invest in them, as I would only have to invest my own time and resources into them, not have to support them while I am at it.
Depends on the job market. If people are desperate for jobs, and they cannot go elsewhere, then the employer doesn’t need to pay them what they are worth.
I also own a small business with 4 employees including my wife. I pay Doll a straight wage as she is the manager but the other 3 work on commission. On commission all three average at least $25 an hour by the Sales they make divided by the hours worked. Am I also supposed to give them $15/an hour? Because I can’t afford to do both. I know that at least one guy, if he makes $15/hour whether he sells or not his sales are going to decrease.
Do you have to pay them $7.50 an hour as well now? No.
It would be the same thing, a minimum wage. If they are making more than $15 an hour, then you don’t need to do anything.
If they are not selling enough to pay them the MW, you can always let them go.
So my understanding is a commission worker has to be compensated at “at least minimum wage”. It is not $15 + commission but at least $15 per hour.
If this guy is too lazy or inept to want to exceed $15 per hour, maybe you need to let him go and move on to the next employee.
Has anyone suggested that is how it would work? If they are already making $25 and hour why would you be asked to pay them $15 more per hour? I can see that you might have to guarantee a minimum of $15 hour even if the sales don’t reflect that, and even that may be based on an average over a long term.
To my understanding it doesn’t work that way now and isn’t planned to work that way in the future.
No, automation goes way back. Remember the Luddites from the eighteenth century? They were protesting mechanization of the knitting industry.
It’s curious that when we talk about minimum wage and unemployment rules the folks that are against changes always bring up ‘slippery slope’ type arguments that ARE ALREADY COVERED BY THE LAW isn’t it?
But it has changed. What can be automated is increasing faster than people can be trained or brought up to do new jobs.
It’s one thing if a few industries are threatened by automation. It’s a whole different issue when there are very few that are not.
Just once I would love to see a post like, “Good point, never mind” or “I checked with my payroll person and they explained that is how it works. So never mind”
Lots of jobs are available today that Ned Ludd would never have imagined. I expect that will be true in the future.
You expect that to be true, but can you guarantee that to be true?
Worker productivity has increased massively over the last couple of decades, but wages have not even come close to keeping pace. Is that a trend you expect to change?
Ludd saw a few industries at risk, not the majority of the work force. Ludd also opposed progress for this reason. I do not oppose progress, I just think that we need to be prepared for it. Your comparison is useless in this situation.
It is not as if people have not been displaced and out of work by automation. It is something that does happen. And it is something which is accelerating in pace.
I should have explained my question better. Much better, actually:
So if one of my employees fails to make any sales one week, should I have to still pay him $15 an hour for being here?
If nobody shows up at my sons bistro, should he still pay his waitstaff $15/hour for being there?
If the answer is no to either, why not? Both employees came to work.
And what about that ditch digger and hamburger flipper? Both could be high school drop out dummies but the level of labor they are providing is different. Why on Earth should they receive the same rate of pay?
The entire philosophy of raising the minimum wage to raise peoples standard of living is nothing more than a phantom. It’s chasing the dragon. It doesn’t produce the result hoped for. It never has and never will.
To be fair, for many small business owners, that would be talking to themself.
Other than that, I entirely agree with your sentiment.
Yes, you can always reduce hours if poor sales becomes a longer-term problem, but people should be paid for being required to spend time at a job.
I agree with conservative economists that the minimum wage is a messy instrument, and that it creates some economic inefficiencies and even leads to inflation in some situations (though inflationary pressure seems to be low now). Even so, I think there’s a moral/social/political argument to be made for minimum wages in that it protects against exploitation.
And before anyone says that the government shouldn’t be imposing morality on the economy, I’ll just say that economic systems are always political systems – you cannot extricate the social/political from the economic and vice versa.
Yes, and if they do so consistently, then you can let them go.
As it is, you have to pay them $7.25 or whatever your local minimum is, even if they don’t make any sales.
As it is, they need to make the local MW, whether or not anyone shows up, so yes, if it were an increased MW, then he would have to pay them that.
Why would they? If I can make as much doing an easier job than a harder job, then I will do the easier job. Then the harder job will increase in pay to an appropriate level to attract those employees.
I’m not entirely sure that your analogy works either, as both these jobs are becoming far more automated. And I would rather drive a backhoe than flip burgers, even at the same pay.
Are you saying that more money in people’s pocket will not increase their standard of living? That doesn’t make any sense at all.
We have inflation, that’s a real thing. It’s not “chasing the dragon” to increase MW to keep up with inflation, it is adjusting wages to meet current costs of living.
Are you also against COL adjustments for Social Security?
Personally, I am looking forward to an increase in MW, as it gives me an excuse to raise my prices. And before you claim that that proves that MW causes inflation, in order to accomodate a 100% increase in MW, I would have to increase my prices by around 15%. And I am a very high labor cost industry. A restaurant would only have to increase by around 7-8%.
Yeah, but if you are trying to raise kids to understand the value of money, having them pay for their own car insurance ($100 a month) and phone bill ($20 a month) means that a high schooler is reimbursing you $120 a month for their own expenses out of their own job. Plus they need gas in the car, they need pizza with their friends, they need the high school team shirt, etc. That’s hard to do on $7 an hour - thus kids don’t learn how to pay their own way because their parents have to subsidize them even with a job.
And yes, I didn’t have a cell phone. But now they are pretty much required - don’t have one, don’t have a social life. Your parents probably don’t even have a land line. Not all kids have a car or access to a car, but plenty of teens do drive and plenty of parents would like them to be able to cover the difference in insurance. Not all kids go to prom, but the ones that do should be able to cover their own date costs, etc. And for a lot of the kids who don’t do these things, they don’t do them because they start economically disadvantaged - they probably need the cash to supplement their parents incomes.